Monday, 5 August 2019

Is Sunshine the New Liquid Gold for the Middle East


Countries like Saudi Arabia, Kuwait and U.A.E. built empires in the sand because of a substantial amount of oil in the early 20th century. The oil and petroleum industry grew during the last decade, with global prices peaking at a whopping $145 per barrel.

The Middle East and North Africa (MENA) an alliance of 22 nations, having more than 60% of the world’s oil and 45% of the globe’s natural gas which means that they are one of the main global generators of greenhouse gases and in turn drivers of climate change. Thus, a push for more sustainable sources of energy coupled with the latest entry of competitors into the market (e.g. alternatives like shale gas) is gently coaxing the focus away from oil and petroleum.

Electricity consumption has grown in the region in the decades following the discovery of oil due to rapid infrastructure development. The dry and hot climate of countries like Kuwait, UAE, and Saudi Arabia mean water is a scarce resource so they meet their large water requirements through massive desalination plants drawing water from the seas around. Desalination plants ring the Persian Gulf, the Red Sea and the Mediterranean, representing over 46% of our world’s desalination capacity. Fossil fuels currently power these plants and make up approximately 50% of their operating costs.

In the past decade, MENA is undertaking multiple massive solar power projects. At the end of 2018, MESIA (Middle East Solar Industry Association) reported that the region had started, completed or is currently operating enough projects to generate more than 12,000 MW of energy; an increase in production by 15% from last year. Due to the geographic location, the Middle East receives more than 3600 hours of sunshine annually so investors are setting up solar farms to convert solar power into usable electricity. Announcements of new solar power plants are popping up all over the GCC (Gulf Cooperation Council) states. Funds are being committed and contracts awarded on a very large scale however, this does not mean power generation always happens.

Solar power has to compete with other renewables so a power source, which is tied to unreliable sunshine, becomes less appealing. PV panels only produce power when they receive sunlight, so even a passing cloud renders them unproductive. Part of the problem is that even though the cost of producing electricity from solar PV has fallen, the value of the electricity generated fell even quicker.

The shift from fossil fuels to solar power and other renewable sources is an inevitable natural transition in the 22nd century and MENA, along with other Gulf States being the prime territories for solar power generation. As solar production increases and greater applications are found across the different fields, further innovation will only bring down costs. As the liquid gold underground runs out, perhaps the Arab world will turn harness the gold in the sky.

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